The Freemium Business Model: Using The Power Of FREE To Make Money

I’m going to give you some free advice… it might be free advice… but it’s incredibly powerful advice.

It might just be the best darn rooting tooting advice that you will ever need to hear.

Are you ready?

Here goes…

Giving stuff away for FREE is one of the best ways to grow a business and make money.

In fact, I’d say that it IS the best and only way to grow an online business.

A lot of people baulk at the idea of giving stuff away for free because they believe that a business is about making money… which is true.

They want and need to make money so they think that giving stuff away for free will mean that they won’t make any money.

Nothing could be further from the truth.

I can tell you that the opposite will happen.

When you give away a lot of stuff for free, you build a relationship with people who will eventually become your clients or customers.

Before I explain the freemium business model in more detail and give you a perfect example of one of my freemium successes, let me first tell you the story about Trent Reznor, the lead singer of the popular American rock band, Nine Inch Nails.

Trent’s Digital Download Bonanza!

Trent decided that he wanted to go it alone and ‘sack’ his record label and so he set up a website where he offered his fans the chance to download all of his new music for free.

All they needed to do to access his new digital content was to hand over an email address.

He gave away all of his new material for free (I think there was an option to donate some money as a ‘thank you’ if you chose to) and do you know what?

Within one 24-hour period Trent Reznor generated over $750,000 in sales of an exclusive limited edition bundle including a book and collection of music on vinyl that he promoted to his email list.

Diehard fans wanted to own the limited edition bundle priced at several hundred dollars and so as soon as he launched it and informed his fans by email, he sold out generating a lot of money.

Okay, Trent’s story is going to be a little different from yours due to the fact that he already had an established fan base after years of being in the band Nine Inch Nails, but when he went it alone and needed to start his own email list, he had to start from scratch just like everyone else and give away something for free.

He gave away a stack of his music as free digital downloads.

Giving real physical items away can be costly but when you run an online digital business, the cost of giving stuff away for free can be minimal.

There is a way to give away physical items for free and lessen the cost to you and I will come to that shortly.

Let me explain how the freemium model works and how giving away free stuff can make you money and grow a business.

FREE Is The Magic Number!

Everyone loves getting something for nothing, it’s human nature. But here’s the thing, when it comes to giving away information products such as email newsletters, reports, books (both eBooks and real physical ones) or a trial to a software or service, people give you their email details (and home address and phone number if you ask for it) in exchange for them.

This means that you now have a way to TALK directly to the prospect through the use of email, PLUS… you can talk directly to them through your giveaway.

Your giveaway shows the receiver exactly what you can do and how you can help them to achieve the results/end goal they want and need.

If they know that you can deliver the goods, they are going to want to use you or buy from you.

It’s All About The P.T. L.!

When you give away free reports and eBooks which have PROOF that you can do what you say you can do, people will grow to TRUST and LIKE you… and that is vital.

Nothing sells more than a combination of:

  1. Proof that the person and/or the product/service do what they say it can do.
  2. Trust in the person and confidence in their abilities.
  3. Liking the person for who they are.

Those three things combined are incredibly powerful. And the best way to get potential clients and customers to trust you, like you, and to know (proof) that you do what you say you can do is to give away quite a bit of stuff upfront for free.

Hold Just Enough Back To Make A LARGE Profit

It has been said by a few marketers that you should give away 90% of your content and then charge for the last 10% only. I’m not sure that I agree with that specific ratio, it depends on what you are giving away and selling.


The final 10% – 30% has to be the most important ingredient that people need to reach their desired results.

Without it, they cannot get to where they want and need to go and so they will happily pay to acquire that information or use your service.

That is where the money lies.

People will pay good money to get that last important piece of information which will blast them through the final hurdle onto success.

You can tell them WHAT to do in the free content, and then show them HOW to do it in the paid for content… or do it for them.

I call it…

Useful… but incomplete!

Everything that you give people for free is useful but it is lacking in some vital information.

Very few will be able to make a start and achieve success without the last bit of information.

I’m not saying that a few smart cookies can’t, but the majority won’t because they need the exact step-by-step formula and blueprint.

They will need the missing ingredient to make it all happen.

They need the final piece of the jigsaw.

Think of it like this…

A company that makes professional DJ equipment holds a free one-day event where they teach people how to mix music and become professional DJs.

Those who attend the free event learn a set of skills that allow them to charge for their services.

The only problem is that to become a paid DJ, they need the equipment to mix with. Without the equipment, they have no way of performing and no way of making money.

You can’t simply mix music on thin air… you need mixing desks like those used as part of the free mixing lesson.

So they now have no option other than to buy or lease the equipment they need from the company that hosted the free DJ lessons.

That company now has several new customers which they didn’t have until they hosted that free one-day event.

See what I mean?

They gave something away for free, and got several new customers because of it.

You can teach people the whole kit and caboodle and still make money simply because of how you set it up.

Books… The King Of Free Content!

One of the best ways to teach people all about a specific business or how to do something specific is through the use of a book.

You write (or pay someone to do it for you) a book which you then give away for free.

You can give away a digital eBook or a real physical book… or both for audiences in different parts of the world perhaps.

A book is like a business card… but a million times better… and no, that isn’t an exaggeration.

A real physical book gives the receiver the opportunity to read all about you and what you can do. It’s a tactile experience. They hold it in their hands, they turn the pages, they can return to it whenever they like and they can see it when it is sitting on the shelf or desk. It’s a great reminder of who you are and what you can do.

A book plays a big role in nurturing a relationship with people. It’s a vital asset to have in your toolbox.

A book can point readers to specific online destinations too. A business card may only have one webpage address printed on it, a book can have many.

A business card can only tell people who you are, the name of your company, and what kind of service you offer.

Whereas a book can tell people exactly what you can do along with examples, case studies and testimonials giving plenty of proof.

A real book will have a cost to it but you can lessen that price by giving the book away for free but charging a one-off shipping and handling fee. It may only cost $5 to send the book to most places within your country, but by charging $9.99, you are clawing back a little of the printing costs too.

Printing a real book will be cheaper if you do it in bulk. When I first started in this business, you had to order several thousand before any printer would entertain you. It required time to set up the printing machines and so they insisted on a minimum order.

Today, that is no longer the case.

Companies like Amazon allow you to print books on demand. Amazon has its Kindle Direct Publishing platform where people can self-publish their own books and buy ‘author’ copies at a reduced rate.

This means that you can order a few hundred or just a handful at a time instead of having to buy a minimum order of several thousand.

Email… The Queen Of Free Content!

FREE content can be delivered in many ways using different media. I also like to use email because with email I can direct people to articles, videos and podcasts where the recipient can see and hear me talk about specific subjects building the relationship even more…

But also…

With email, you can send people tips and advice in a simple short email or you can send them an exclusive in-depth article that teaches people how to do something specific.

You can send emails regularly which helps to constantly nurture your relationships with the people on the list. Some people send an email every day.

Email is a fantastic and powerful tool and one that I shall talk about more in future emails. Keep your eyes peeled for them!

Help Thy Neighbor And Do A Good Deed Everyday

Every piece of free content is like a ‘good deed done’.

Whenever you help a neighbor or a stranger, the deed is remembered. When you do multiple good deeds, it leaves a lasting impression on them.

That is what you need to do with your free content.

Do a good deed and leave a lasting impression on people.

Real Life Example

I’m going to share with you a real example including some figures. This is a slightly more advanced method than simply writing blog posts as it involves a postal mailing and a sales funnel.

We are currently giving away a full trial of one of my systems completely free.

At the time of writing, in total we have sent out 1,894 “Full System Trial Packages” as I call them… we used to send these ‘completely free’ even the postage was free… but in order to test and tweak the offer we now ask for a contribution of $9.95 towards the costs of shipping and handling.

While this contribution towards the S&H does not cover the costs to send out the ‘full system trial package’ we have a couple of upsells that we offer to help offset the immediate costs and then we lead into a recurring membership subscription program.

It costs around $20 to fulfill each Full System Trial Package request. So the customer is meeting us halfway on the costs of this.

At the time of writing, we have generated $572,275.88 in gross sales by giving way some fantastic information up front … and then following up with further information afterward.

With this in mind… $572,275.88 means that on average we make $302.15 from each customer that requests a Full System Trial Package from us.

To clarify… that free content we give away generates $302.15 from each person who requests it!

In the last 2 weeks following a direct mail promotion to 30,000 people (costing $21,267.22) we have given away 133 Full System Trial Packages.

While we are yet to break even, (it takes 60 days to do that) judging on our existing stats… we should generate a total of 133 x $302.15 = $40,185.95 in recurring membership fees from these new customers.

In addition to that, there could be further income from other back-end products / services because the people who have taken up our Full System Trial Packages offer have been exposed to a lot of great information for free and they have come to know more about who I am and what I and my systems & services can do for them.

That is powerful!

Okay, so now you know that giving away FREE content leads to making LARGE amounts of money, you are probably wondering how to make quality content that can grow your digital business and put thousands of dollars into your bank.

Everything you need to know can be found by clicking the link below:

Click Here Now To Discover All The Details About Going From


You can even start with absolutely ZERO in terms of a marketing budget. You certainly do not need to invest $20k (like I do) to give away things for free.

I choose to do that because I have complete confidence in the Free To Fee Formula I’ve perfected over the last twenty years.

So, yes you can do this, even on the tightest of shoe-string budgets. Take a look now.